dinosaur39 Loc: Harpers Ferry, WV

Is it true that Kodak resisted digital photography because it did not want to lose its film and chemicals business?
I also have heard that Kodak pioneered the digital camera and then put it aside so as not to jeopardize its traditional film and chemicals sales. If that is so, shouldn't someone do a study of the management of Kodak at that time and name names and assign blame for the collapse of a major American company.
Everything is sacrificed for shareholder value. What do they teach at Harvard Business School?

OlinBost Loc: Marietta, Ga.

Do unto others as they would do unto you (only do it first)

technilen Loc: New Jersey

Hi Dinosaur!

Yes, I think that's what happened. Don't remember when I first heard this story but I worked in the consumer electronics industry for many years and picked this up - maybe through trade journals, maybe just gossip among sales guys. It saddened me to watch as the company grew ever less important in photography circles even though it had done much of the critical early research in digital images.

I've seen that happen to other companies also - Sony comes immediately to mind - who brought us the Walkman only to see Apple's iPod just wipe the floor with them. And let's not even mention the Beta vs. VHS struggle.

Regis Loc: Coeur d' Alene, Idaho

The same can be said about Polaroid. They just couldn't see how digital photography could compete with them.

MW

I think this has already been written up a number of times. In defense (somewhat) of Kodak management I'll opine that they found themselves in a trap that offered few means of escape. Long before digital arrived their strategy was to sell many relatively inexpensive low margin cameras also encouraging others to make and sell lots of cameras BUT to dominate the production and sale of film. Film was where the money was rather than the cameras. Sometimes this is called the "Razorblade Model".

As film died no amount of digital cameras could replace the lost revenue from the film. Big layoffs and the sale of assets were not enough. Kodak had locked itself into a pension benefit scheme that worked so long as they remained a much bigger company; a downsized company focusing on digital products would be liable for maintaining more pensioners than it had actual employees. Pensions are a late 19th early 20th century idea that worked well for a long time. If you look at newer companies like Apple, Microsoft etc you will find few if any pension (defined benefit) plans but 401K's (defined contribution) plans.

Papa Joe Loc: Midwest U.S.

I'm reminded of a Kodak sales rep's remark back, (way back!), when I worked for Midwest Photo Co. When he was touting Kodak's 'new' disk cameras that were just about to hit the consumer market, he also commented, "just around the corner you'll see what they're calling 'digital' cameras, but don't get too excited about them... they are not practical and probably won't make much of an impact on the general market."
(I wonder today how many times he's wished he could swallow those words? :o)

Madman Loc: Gulf Coast, Florida USA

There were many reasons for Kodak's failure reaching way back to the 1960's .

My experience operating a mini-lab demonstrates that whatever they had learned about creating and manufacturing quality negative film, they forgot. Their emphasis on sharpness (Ektar) at the expense of color accuracy and consistency hurt their film sales and provided the opportunity for Fuji to make major advances.

The APS format was a dismal failure.

They chose the video market as their departure from chemical imaging, releasing the 8mm video format in 1980. This was clearly the best system then available, but 10 years too late.

Sitting on one's laurels and hoping to survive is never a good business plan.

rook2c4 Loc: Philadelphia, PA USA

The primary cause for Kodak's failure was short term planning to maximize short term profits. The board members at Kodak in the 1990's and their greed are to blame. They are the ones responsible for bringing in a CEO who was known for making money quick, with little regard to a company's long-term future.

MW

Most industries go through this. Someday it will happen to MS, Apple, Google etc.

There are a few cases of survival but it requires drastic changes. IBM is an example-- many don't think they are still around but they are actually doing pretty well in a market niche that doesn't much get in the public eye

LFingar Loc: Claverack, NY

Many companies have missed the mark with their planning and outlook, Kodak and the Detroit auto industry being prime examples. At the end of WWII Henry Ford, a supposed automotive genius, was offered the chance to buy VW for pennies on the dollar. Turned it down. Said the cars would never sell in the US! Fortunately, more and more companies are learning the lesson that many Japanese companies seem to have known all along: You don't plan for tomorrow. You plan for 20 years from now.

Swamp Gator Loc: Coastal South Carolina

And Coke had several opportunities to buy Pepsi, but passed, which would have given Coke practically the entire cola soft drink market with no real competition.

elwynn Loc: Near Atlanta, GA

I remember when VW and Toyota started to sell in the US, a GM exec saying "we're not interested in that part of the market".

rook2c4 Loc: Philadelphia, PA USA

Most of the time it does not work that way. A new competitor often rises quickly to fill the gap. If Pepsi had disappeared, then perhaps RC would have become the new consumer alternative to Coke, and ultimately Coke's rival in the soft drink market expansion in later years.

doduce Loc: Holly Springs NC

Something similar--I think it was Thomas Watson, the founder of IBM, who said something to the effect that he could only see the need for 10 computers in the entire world, so no need to get too involved in that line of business.

rehess Loc: South Bend, Indiana, USA

I don't think that is quite fair. By the 1990's, Kodak was selling virtually zero cameras, an earlier generation of their managers had ceded that field to others, so they started off with an uphill struggle to get into digital. I did see an occasional Kodak digital camera until their bankruptcy, but they were always a step behind those who were already in the camera market.